5 things to know about late-season tax returns

Published 11:51 am, Tuesday, April 4, 2017

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5 things to know about late-season tax returns

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According to a release by Nathan Rigney, senior tax research analyst at The Tax Institute at H&R Block, it’s April and “this year 4 million more taxpayers are waiting until the last two weeks to file their tax returns.” Further a “new law meant to combat fraud contributed to refund delays, causing more taxpayers to wait to file their returns. But procrastination is not new: in the past, more than one in three taxpayers who filed before the April deadline waited until April to file.”

But there is more about late-season filers.

Last year, they were:

• Not alone: more than 41 million taxpayers waited until April to file.

• More likely to have complex returns: 77 percent of April returns are Form 1040s compared to 67 percent earlier in tax season.

• Still likely to get a refund: 65 percent of April returns got a refund compared to 80 percent of early filers and more likely to get a smaller refund: the average refund was 16 percent lower, but still more than $2,000.

• More likely to get help from a person: tax professionals and volunteers prepare 61 percent of e-filed April returns but only 57 percent of those returns in January to March.

• More likely to paper file: 52 percent of all paper returns were filed during April.

Rigney, the release notes, “advises taxpayers who still have not filed a tax return to file either a return or an extension by the April 18 deadline.

“The monthly penalty for not filing a tax return is 10 times greater than the penalty for not paying in full,” said Rigney in the release. “The best way to avoid this penalty, which could quickly add up to 25 percent to their tax bill, is to file a completed tax return or apply for an extension. However, an extension doesn’t apply to any payments due.”

(“In other words, the extension to file is not an extension to pay for those taxpayers who owe the IRS money. Taxpayers must pay at least 90 percent of their 2016 tax bill by April 18 or they will face late-payment penalties and interest.”)

Editor’s note: This information is posted with credit to Nathan Rigney and The Tax Institute at H&R Block.